Mining companies, NGOs can reconcile: UN advisor

“Profound changes” in the environmental and human-rights movements may signal a major opportunity for the mining industry to change its relationship with non-governmental organizations (NGOS), says a senior advisor to the United Nations Development Program.

Richard Sandbrook, speaking at the Mineral Outlook luncheon of the Prospectors & Developers Association of Canada, said a “third generation” of activist groups, more interested in outcomes than in policies, could be more prepared to co-operate with the private sector, in contrast with earlier generations that had actively campaigned against mining.

Mining had been “accosted by the rise of civil society,” said Sandbrook, noting how activist groups had traditionally been divisible into “campaigners,” who measured their output by media coverage and policy victories, and “doers,” who looked for successes on the ground. He said NGOs are not monolithic, and that environmental groups with wide global awareness and development groups prepared to broker ways to reduce poverty could find common ground with mining companies in the Third World.

One example of a success, said Sandbrook, was the agreement in the diamond industry to suppress the conflict-diamond trade from western and southern Africa. Major diamond producers, governments, and NGOs developed the Kimberley Process to cut off the trade.

Co-operation would face opposition from “campaigner” groups. Sandbrook said Greenpeace, for example, has its “brand all tied up with opposing Shell,” and for organizations like those, there was no room to co-operate with the private sector. Such groups, fed by press coverage, take isolated cases and hold them up as typical, even though the result is public misunderstanding of the issues. In spite of this, they are trusted by the public, and “if they are trusted, we have to have some dialogue with them.”

Global disparities in income, wealth and public welfare continue despite large flows of foreign aid, and Sandbrook said a lack of support for private enterprise prevents aid from making a difference. Only 4% of aid from the developed countries in the Organization for Economic Cooperation and Development goes toward private-sector development. “NGOs and governments oppose the privatization of water,” he said, “yet we need pipes and plumbers. . . Oxfam does not employ a single plumber as far as I know.”

The mineral industry — as much as some NGOs oppose it — is a foundation for development in the Third World, Sandbrook said. “Enterprise makes things happen, and underneath enterprise are the things of the earth.”

Turning to the idea of corporate social responsibility, Sandbrook told the luncheon it was valued not just by NGOs but by governments, who found it “a good way . . . to dodge their responsibilities to bring in sensible legislation.” For the mining business, social responsibility had not helped with the World Bank’s Extractive Industries Review, widely seen as an exercise in bashing mining.

Still, it remained the condition on which industry got society’s consent to operate. “All this is fine if you’re a big boy,” he said, but asked, “does it make any sense for the small guys to do CSR [corporate social responsibility]?” The answer, he said, was that junior projects will not be marketable to the larger companies unless they can draw approval from the rest of society.

Sandbrook concluded with a 5-point wish list the mining industry can use to gain future social licence. Industry associations should be pressed into service to develop and implement standards; he pointed to the PDAC’s E3 environmental handbook as an excellent example of the way associations could lead the industry. Industry should “get the word out” that it is acting responsibly, to counteract the campaigners’ opposition. It should also address legacy environmental problems by contributing its expertise — though the money to clean up old mines should come from the public purse.

Sandbrook said new business models could also help — for example, by curbing environmentally irresponsible artisanal mining. Lastly, he said industry should “walk the talk with transparency, pride and profits.”